What are some of the core truths of servicing growers at the retail level?

There are many challenges in working with today’s progressive growers, including grower consolidation, increasing grower size, a grower who can handle many previously outsourced services, a grower who is working hard not to be price taker on purchases, and of course the grower who expects more and is more willing to change service providers in search of what they want. I say all those things not to disparage growers; in fact, most of us would behave similarly if put in their shoes. But perhaps the biggest core truth of servicing growers today is understanding that growers will be more loyal if they are receiving innovative technology and services and know their business is appreciated.

The truth is, competition gets more intense with each season.

Consolidation is rapid on the business side of Ag which is leaving only strong, well-resourced, and innovative companies left to compete. Providing good products coupled with good service is often no longer enough. You must get creative, take some risk, and put quality people on the farms to work with the grower. It’s also critical to provide cutting-edge advice and solutions that take the operation to the next level. But even if you do all that, how do you measure success at the end of the year?

It’s time to raise the bar for measuring success.

You can look all around agriculture and see thousands of ways technology has improved the industry. However, we haven’t raised the bar on how we measure success, and that is holding us back from making more rapid gains. Bushels per acre or yield does not come close to getting it done; it’s what we have used forever only because there wasn’t something better to put in its place. The problem with yield is there are so many factors that differ between fields, and from season to season these measures of success become very inconsistent. It’s like saying to a group of golfers that you shot an 85. What’s the first thing they ask you: What course did you play?  Then you might add that it was really windy that day, and eventually, everyone in the room gets a better understanding of the value of your 85.

Data provides a more meaningful standard.

To carry on with some ag examples, if a cornfield yielded 200 BPA two years ago but yielded 220 this season what is the reason for the increase? And how much of the increase was due to educated agronomic changes between years in hopes of boosting the yield, versus different weather events during the growing season? The problem is currently no one can give you that answer, and it can get even worse when the same scenario happens in reverse and the yield drops 20 bushels. And then the grower looks at you and says, “Why did we change to the more expensive hybrid that produced fewer bushels?” At this point you need actionable data on your side – data that could show the grower that the hybrid decisions was a good one, but the growing season was more difficult causing the drop in yield.

It’s easy to see that additional data is meaningful to understand what a production measurement truly means. If you could understand why a 180 BPA cornfield in one year is more consequential agronomically than a 200 BPA in that same field in another year, what kind of value could you bring to your customers? It all comes down to agronomic decisions in a business with a million variables. Wouldn’t it be nice to be able to remove the weather variable and show your growers only the effects of the agronomic decisions that were made?

A higher yield does not always mean better production.

Data insights are even more meaningful when applied against historical results. Let’s say a field has a yield history of 190, 180, 220, and 200.  By looking at yield results, the field has been up and down, but the two most recent years have been the highest. Main Street Data normalizes production for weather and soil, and then applies percentile scores for these years, with surprising results:

 

BPA vs true perforamnce

 

The smart application of data to change from simple BPA now tells a completely different story. Taking into account the weather conditions across these 4 years, the best result happened in Year 4, with 65% percentile and 200 BPA.  In other words, 200 BPA was a stronger outcome than 220 BPA given the conditions in that year over the year before. This is the tough win in worse conditions that exceeds the easy win in better weather.

This true measurement of performance is amazing in and of itself, but now let’s consider inputs. What if your agronomist influenced a decision to apply fungicide going into the most recent year, and based solely on yield results that decision was viewed as unfavorable. A decision to not apply a fungicide in the future because it didn’t pay based on yield would be wrong, because the production percentile increased. This shows that the agronomic decision to add fungicide was the right call and should be continued. And in fact, without that fungicide, the BPA would have fared far worse. There are hundreds of scenarios this data can be applied to, but this gives you a good idea of how this type of performance measurement, normalized for conditions, really matters.

Everyone wants great results — but only some will use data to create those results.

Everyone wants to know what works best on their farm, and the industry is doing its best to provide the data to answer that question. But using yield alone to make these determinations is a flawed method. Can you see the power of using true performance to analyze a particular product (hybrid, fungicide, biological) over a region? Where the results are not given in yield but rather in true performance percentiles which consider all the variables?

Main Street Data does this by normalizing the uncontrollable factors – primarily weather and soil type – that affect production. These results are shown in percentiles compared across different fields in the same crop year, or you can view the historical benchmarks of a field and determine if the agronomic decisions you’ve made with the grower over the years have been beneficial. This makes input comparison much easier; by comparing results, you can make a more confident, informed decision on products.

It’s like having a seasoned caddy on your side.

Just as an expert caddy can point you to the right club, the intelligent application of data can help you point growers to the right products. Data can provide a much more precise measure of success given the conditions, thus more accurately showing the effect of the agronomic changes made between each growing season.

The insightful application of data makes this level of detail both possible and powerful, and this kind of measurement can only be done through a proprietary massive calibrated yield data set, that includes millions of acres over 26 states – creating 1.3 billion calibrated yield samples over a 7-year period. 20 years of weather history is laid over the top of the yield data creating the most dynamic Ag data set in the country. Our GrowingScore services leverage that data set to normalize production to reflect the true performance of your fields, regardless of rain, soil, or “good years.” With GrowingScore, you can avoid the typical responses that blur good decision-making when discussing yield, such as, “Yeah, but that field had more rain, or that field has better soil, or that field always shines in a drier year.” Think of all the possibilities and the efficiency gained in making agronomic decisions, with a true measure of success on your side.

Contact me to learn more.

The opportunities are endless, and I hope this has piqued your interest. Please feel free to reach out if you have any comments or questions. I’m happy to discuss how I think retailers could get the most out of offering this groundbreaking new way to measure true performance and improve decision making.

 

Tim Davis

Tim Davis

V.P. AG MARKETS & BUSINESS DEVELOPMENT

Cooperatives, Grain Marketing Advisors, & Ethanol facilities
217.599.0595
EMAIL

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